Seasons are Diablo 3's version of the Diablo 2 Ladders, and they were added to Reaper of Souls in Patch 2.1 in August 2014. When a season is active, players can make new characters (hardcore or softcore) and click the "Seasonal Hero" button during creation. That will designate their characters as Seasonal, and they will only be able to play or interact with other Seasonal Characters for the duration of that season.

Each Season is a fresh start; players can not bring in any of their existing characters, items, paragon points, gold, artisan levels, etc, from their normal account. This puts everyone on a level playing field, and Blizzard sees it as a way to bring players back into the game, as they can play with others of their power level, rather than trying to join public games with Paragon 700 Torment 6 steamrollers.

Seasons will run for a TBD time, presumably around 3 months, and when a season ends all gold, items, characters, etc are merged back into a player's main, non-seasonal account.[1] As each season ends a new season will begin, and if players want to take part they must create new seasonal characters and go from scratch all over again.

When a Season Ends

Players had many questions about how a Season's ending would be handled, in terms of merging experience, gold, items, paragon points, artisan levels/recipes, and more... from the seasonal account back to the main account. Blizzard ran several trial seasons during the PTR testing of Patch 2.1 in August 2014, using that to iron out the kinks in the system.

A community manager answered numerous fan questions during that time:[2]

PTR Season 1 Roll-Over:

After PTR Season 1 has ended, the Season roll-over will begin. During the roll-over, your Seasonal heroes, inventory, shared stash, and Paragon experience will be transferred to your non-Seasonal profile.

Heroes: At the end of a Season, your Seasonal heroes will become non-Seasonal heroes. They will appear in your normal roster. Any items, equipped or in the hero's inventory, will roll-over with the hero itself.

Shared Stash: Items in your Seasonal heroes' shared stash will be mailed to your Normal/Hardcore non-Seasonal profile. These items can be retrieved by entering a game on any non-Seasonal hero and clicking on the mail icon located in the lower left of your screen.

Paragon Experience: Paragon experience earned during a Season will transfer over directly without any additional involvement required from players. All Paragon experience will transfer, with experience gained by Normal Seasonal heroes going to the account's Normal non-Seasonal profile, and experience gained by Hardcore Seasonal characters going to the account's Hardcore non-Seasonal profile. (Note: Non-Paragon experience will not transfer.)

If you experience any issues with the roll-over, please let us know in this thread, and provide as many details as possible. The more information we have, the better we'll be able to identify and address the core problem.

Please, can you explain what is going to happen if we already have all characters slots full in the normal roster? The seasonal character its going to be added in a new character slot?
In order to create a Seasonal hero, you'll need to have an empty character slot in your roster. If you do not have an empty character slot at the start of a Season, you will need to first delete one of your active heroes.

Will achievements earned in season mode also be rolled over to non-season and granted there (if you didnt previously have them in non-season)?
Under current design, if you unlock an achievement on a Seasonal hero that you haven't already unlocked on a non-Seasonal hero, you'll gain credit for both at the same time.

1. Does gold count as "inventory" and will also be transferred?
1. Gold will be automatically transferred from your Seasonal profile to your non-Seasonal profile. Ditto for Blood Shards.

2. Other progress such as artisan levels or crafting plans your artisans have learned will not be transferred/refunded in any way, right?
2. If your Seasonal Artisan is higher level, its level should transfer at the end of the season. Any recipes you have on your Seasonal Artisan that are not on your non-Season Artisan are transferred as well.

3. I second one of the questions above - what happens if your normal roster stash doesn't have enough space for all the items in your seasonal stash?
3. All items within the Seasonal stash will be mailed to your non-Seasonal profile at the end of the season. These items aren't automatically placed in your non-Seasonal stash, so you can wait and make room first before claiming them (if needed). Under current design, mailed items from your Seasonal stash will remain available for 30 days after a Season has ended.

I believe (correct me if I'm wrong) that a seasonal character already takes up one of the slots and thus it will simply stay in that slot, but have its seasonal tag removed.
Correct.

...

Quick note about Blood Shards and Season roll-overs:

When transferring over your Blood Shards from your Seasonal profile to your non-Seasonal profile, we will temporarily ignore the 500 cap.

For example, let's say my Seasonal profile has 200 Blood Shards and my non-Seasonal profile has 400. At the end of a Season, the 200 shards from my Seasonal profile will combine with the stack of 400 from my non-Seasonal profile, giving me 600 shards total (not 500, the normal cap). This is deliberate.

The caveat here is that players will be unable to pick up any more Blood Shards until they drop below 500.

What will happen to legendary gems? Will their levels add to those of the same non-seasonal legendary gems? Will you have two of such gems? Or will it simply end up being the higher level gem becomes the non-seasonal gem?
Under current design, you'll have two of such gems.

wat about non-season can we get item wipe and ladder reset there are still 2 sockets weapon in game...and people use The Furnace for ladder etc.
We will be performing a PTR-wide wipe for all Leaderboards this evening as well. This wipe will be global (i.e. it'll affect Seasonal and non-Seasonal Leaderboards).

what if it is the same level and the seasonal artisans have different recipes or new recipes, will it transfer? because you kinda linked to if it is only higher level.

Season Information

Ladders are "Seasons"

The official name for ladders in Diablo 3 is "Seasons" which is a bit confusing, but apparently meant to set them apart from the much simpler Diablo 2 ladder system.[3]

Similar to Ladders in Diablo® II, Seasons will offer players in Diablo® III a chance to periodically start fresh, leveling their level 1 characters and artisans from scratch. Season participation benefits include exclusive rewards and unique Legendaries as well as the the thrill of climbing all-new Leaderboards by completing achievements, earning Conquests, or running Greater Rifts.

Leaderboard first sample image.

Blizzard Comments on Ladders in Diablo 3

Fans have been asking about ladders since Diablo 3 was first announced back in 2008, and while the developers always sounded open to including them, it took years before the idea moved beyond the drawing board. Here's a chronological collection of official comments on the idea of Ladders in Diablo 3.

September 2010

Early comments on ladders were of the "maybe someday" variety. Community Manager Bashiok talked up other game features as a better way to rank players in September 2010. [1]

As far as the e-peen meter goes for showing off a higher level character, we think a proper achievement system is much better at this. There’s more variety, they’re more interesting and compelling for people to work toward. One important point of note is that our achievements are cross-character, meaning we can give achievements for things like leveling 5, 10… hell, 20 characters to 60. Certainly a bigger feat than a level 99, and we can give tangible rewards for it too.

August 2012

Jay Wilson talked about wanting ladders someday, but not any time soon in August 2012, in relation to the new Paragon system.[2]

Could we see a Ladder system get tied into the new Paragon system?

Currently no. We don't have any plans to do a ladder system. Probably the question for that is "are we going to have some kind of seasons for the game like Diablo 2 did". I said in the past we are not really interested in doing that, but I really should clarify that. The idea of doing seasons is a really good idea and something we should introduce to Diablo 3 at some point. I don’t see no reasons for it to be at launch, as that is Season 1. We don't have to worry about it till we do Season 2. What im not really keen on is leveling being the primary element that motivates doing a new season. I don’t think it appeals to that many people.

The people that like it really love it and they compete. But everybody knows it does not take that long to get to level 60 in Diablo 3, and it did not take that long to get to level 99 when you level raced in D2. The people that would do that race, they would do it for a couple weeks, and then essentially the season would be over, and the ladder would be over, and that is something we do not want. We want something that feels like as if we introduced seasons, We want whatever the motivation to join the new season be to be more appealing to a broad group of people. That’s not to say we don’t want it to be appealing to our more hardcore dedicated players. We want it to be super appealing to them as well. We just think there are other things than “lets all just level up a level ladder”. So totally for Seasons, not really that keen on the level ladders because I just don't think a big part of the audience benefits from it. If you're basically not in the top 100, who cares?

That means that basically 100 people think it’s awesome, and maybe a couple more hundred think its cool because they think one day they will be in it and to me it’s like, ok really? Like, we are going to put a big feature in, and I’m not saying those people are wrong, or that I don't want to make something for them, I just think we can do better than that.

Paragon experience will be account but will also be broken out by game play mode. Players who play in Hardcore will have a separate hardcore paragon level from their non hardcore characters.

When a season ends all of the paragon experience you have earned will be rolled into the appropriate pool of paragon experience for the account and you will be able to start at 0 again in the new season.

This is all still a work in progress and subject to change but that is what we are currently intending.

Selecting "seasonal" on character creation.

13 June 2013

Blizzard community manager asks for input from gamers on what they would like to see in a ladder system in Diablo 3. [5]

Lylirra

How would you ideally like that system to work?

How long would you like the resets to be?

How many characters do you think players should be able to create for ladders? (Do you think they should take up the existing slots you have?)

Should there be an auction house for ladder characters?

Should there be any special items or perks for ladder-only characters? If so, what kind?

What kind of restrictions, if any, should be placed on ladder characters?

Do think players should be able to bring their ladder characters into “non-ladder” once a reset is complete?

Is it necessary for ladders to be competitive, or is it enough for players to just see for themselves how far they can go on their own?

Why would ladders improve your in-game experience?

15 May 2013

Wyatt Cheng in a video stream back in May of 2013 addresses the issue of how a ladder resets the economy. [6]

Wyatt Cheng:
There are two aspect of ladder, both of which I think are interesting. One is the competitive ladder aspect, the race to the top. The other is the economy reset, this fresh sharded off economy where everyone begins clean. ...(snip)... So I think one of the benefits of a ladder is just this idea that it's really fun to start fresh, and experience this rapid rate of upgrading, again. A ladder is a great excuse to do it. Sometimes we all want to do it and we can choose to do it, but sometimes it's nice to do it together, as a global community. Or have a recognized badge of honor, for having done it.

And later what excites him about ladders and how it could not happen until and expansion.

We're definitely looking into the possibility of a ladder, or something like that. I personally -- this is just me speaking and there are other people on the team who would disagree with me, so I'll say that, it's just my opinion -- I'm more excited about the reroll and clean economy aspect of ladder seasons, than I am of the race. I know the race is exciting too, and there's pictures of people who are getting ready for the new season. They have all their caffeinated drinks on their desk, and I think that's epic and awesome, if not always healthy. But realistically, yeah it's something we're cool with. It wouldn't be viable until an expansion.

Travis Day also chimed in with enthusiasm but still, stresses the fact they will happen later rather than sooner.

Travis Day
Ladder is something that is not out of the question. We talk about it, we're investigating it, you might see it one day. Not making any promises on when or how, but it is certainly something that we talk about a lot. A lot of the talk we do, or sometimes do, is like -- Diablo needs to live on well beyond the point of which we're working on the game. D2 had some support, but you're not going to see (and I'm pulling time frames out of butt, but): Five years from now, you're probably not going to see us making huge content patches, or class updates. At some point we'll set the game aside, sort of leave it as a work that we've completed, and move on to like Diablo 4, or whatever, right? Ladders is absolutely one of the things that helps the game stay fresh for people 5 years from now, or 3 years, or 2 years, or whatever. Ladders are cool, ladders comes with a lot of baggage when I say "ladders"; but the idea is of sort of a fresh economy and a fresh system for people who choose so, to opt into leveling all over again with a clean slate, with other people who want the same thing. That's really important and it's really compelling, and we probably want to have that one day, but I don't know how we'll implement it, or what it'll look like, or when it'll go in.

Ladders and seasons were first confirmed as a feature we would definitely see in the future by game director Josh Mosquera in March 2014. [7]

... we’re still working on them, but the general gist is that you’ll be able to level up a character, we will have specific ladders for seasons, and also some goodies that will drop along the way. There’s more information of that to come, and we’re not making an announcement of when, but for sure Seasons are coming to Reaper of Souls. Yeah, the secret is out.

Well that's a really good question, isn't it, Wyatt? When you're making a game you come up with a lot of good ideas, and some ideas like Devil's Hand you say: it's awesome, it probably needs to bake a little bit longer. But one of them that we felt was really important, that we felt we really needed to take the proper time to develop it, was one of the features you guys have asked about a lot. You might have noticed that Wyatt and myself have done a lot of research for something called ladders. I'm very happy to say that as part of our first big content patch coming out in the next couple of months, we are going to be releasing Seasons, which will include a ladder-like aspect to them.
Well, we're still working on them, but the general gist is that you'll be able to level up a character, we will have specific ladders for seasons, and also some goodies that will drop along the way. There's more information of that to come, and we're not making an announcement of when, but for sure Seasons are coming to Reaper of Souls. Yeah, the secret is out.

In an interview in April 2014 John Hight fleshed out more concrete details of how Ladders and Seasons were shaping up during development and what players can expect to see. [9]

Each Season begins with a fresh characters

No access to existing stash, loot or shards

When season ends all experience, items, gold etc is rolled back into your normal non-ladder roster

New, powerful legendaries that drop only to ladder characters

Leaderboards will rank progress by various metrics such as region, clans

24 April 2014

John Hight in an interview gave up some more details on what's currently in ladders and seasons.[9]

Seasons are a shard of the existing game where everything is a fresh start. You start with a brand new character without access to any of the gold or items you collected with your primary account for the length of the season. We plan on creating brand new, powerful legendaries that only drop within in the season. After the season ends, all of your progress — your experience, your items, your gold, etc. — will be rolled into the main roster. The goal is the fresh-start feeling — so many changes and tweaks have happened since the launch of Diablo III — it is really energizing and fun to recreate that ‘first-moment-in-a-new-game’ feeling.
We’ve also added leaderboards. Players can race on a variety of metrics to try to become the leader in their region or the top of their friends and clan lists. That friendly competition angle lends itself really well to Diablo games.